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To: Andrew Vance who wrote (12304)	2/23/1998 9:06:00 AM
From: Patrick Slevin	Read Replies (1) \| Respond to of 17305

CIEN An interesting snippet from Gene Inger's Friday letter. Along with the following, he points out that the short was viable because the "lockup period" from the IPO had just ended. Similar to what happened when he shorted RMBS in the $80 range, the restricted stock had become tradable for insiders. ingerletter.com ~~~~~~~~~~~~~~~~~~~~~~~~ ...........................................................A good while later we revisited this idea; in the February 2nd Letter, with a shorting zone for CIEN at 58-61. There was a fundamental reason behind it, with technicals used for timing. In late January, Lucent (LU) announced a newly available "wavelength division multiplier" that was fast and readily obtainable, unlike Ciena's. That January 27 story essential told us then what the Company said last night in it's revenue-shortfall warnings for the next quarter. We suspected momentum (and hedge-fund) traders sponsoring Ciena would try to restart a game-in-play (since most of them really don't care about the facts), so we decided to short it if they managed to bring it back to 58 or better. It should be noted this was also a recovery to a short-term moving average that had been broken on the initial news. That's our favorite way to short damaged goods; with a stop just above the old high in case we're wrong, which we sometimes are. But not in this case once again, though very fortunate that the first day a trade in the zone could be executed was yesterday! Then we awake to a 25% homerun in a flash. Now what? Probably a few point snapback, and then lower. We'll tighten-up the stop from a very limited-risk 66 to a lower number in this weekend's Letter (part of which you just read). Also, we liked the concept of spreading Lucent long and Ciena short.